Social entrepreneurship and innovation in Lithuania

Social entrepreneurship and
innovation in Lithuania
Achievements and challenges
Social entrepreneurship
Social enterpreneurship - refers to the practice of combining
innovation, resourcefulness and opportunity to address critical
social and environmental challenges
Social entrepreneurship - the recognition of a social
problem and the uses of entrepreneurial principles to
organize, create and manage a social venture to achieve a
desired social change.
Many different definitions, however, still no consensus among
different government agents, academia and social innovators
Social entrepreneurship in
Social entrepreneurship in
International programs
Social entrepreneurship
initiatives examples
Social entrepreneurship in
Social firms in Lithuania
Law on Social Firms launched in 2004, reform 2011
1st Social firm was established and launched in 2005
Now there are 44 000 disabled employees of which still
only 6,8% are working in Social firms
137 Social firms in total, employing 5,4 00 employees
out of which 3,900 are in the target groups (i.e.
disabled people, long – term unemployed, imprisoned
people, lonely parents etc.)
Social firms in Lithuania
137 Social firms in total
• Disabled Social firms -
• Social firms - 59
(people excl. from the
workforce i.e. Lonely
parents, imprisoned etc.)
firms operate in 9 territorial
labour exchanges
2 associations: Lithuanian
Social firm Association,
Lithuanian Disabled Social
firm Association. (In total
around 14 firms each)
Growth of Social firms in
Since the Law on Social firms was put in place in 2004 the number of employed
disabled people increased 4,5 times. In 2012 November, social firms employed
3934 employees that fall under various target groups categories.
How they are subsidised?
Social firms are entitled to:
Corporate tax relief (15%)
Various Subsidies (incl. payroll, social insurance
relief, transportations, employment, etc.)
In 2011 FYE, the subsidies reached 32,5 M. Lt., (NB –
20,5 M. Lt and ESF – 12,0 M. Lt)
Social firms received 8,5 M. Lt, disabled social firms 24
M. Lt.
On average 9.000 Lt. per 1 qualified employee/year
Subsidies growth in Lithuania
Subsidy for social firms is from Government budget, however, from 2008 and
from European Structural Funds. ESF in 2009 – 6,1 M. Lt, 2010 – 17,5 M.
Lt, 2011 – 11,9 M. Lt.
75 per cent of government subsidies are for payroll expenses subsidies and
social insurance subsidies
Social firm vs. Social enterprise
Social firm does not fulfill commonly used social
entrepreneurship definitions and criteria since:
 It’s not required to reinvest profits
 It’s not required to solve social problems (apart from
disabled employment)
 It’s not measured by source of revenues it generates
However it provides employment to the disabled and
disadvantaged people
How? Where? When?
 What kind of Social entrepreneurship we want in
 What abroad practice and models are adaptable?
 Do we need new legal status for social enterprises?
 Should we promote social enterprises via subsidies?
 Which measures are the most effective?
 Is there enough absorption criteria?
 How to measure direct and indirect social innovation?
 What are the long term goals?
 How to measure progress?
 Social firm status is too
 We need social
innovation and
entrepreneurial and novel
ways of solving social
 New ways to promote
social entrepreneurs (other
than subsidies and tax
 Communication and
cooperation between
What’s the source of social
Social firms
For profits
State owned companies
Rural communities
Socialinės įmonės
Social entrepreneurship
strategic plan
Planned initiatives in place
Soc. Entrepreneurship in ME and Government priority list:
In order to find new opportunities for entrepreneurship and
promotion of private social services and good initiative, Social
entrepreneurship and social innovation development strategy has
to be prepared. (2013 3Q)
Soc. Entrepreneurship in National Progress Programme 2014
– 2020
promote and develop social innovation by NGO (Social
entrepreneurship, social clusters). (
promote social entrepreneurship, by establishing competency
centers, good practice center, accelerators, co-working spaces
increasing mobility and other developing other measures. (
Further plans - 2013
Enterprise Lithuania as a coordinating body/insitution
 Abroad practice adoption to Lithuania
 Training/awareness
 Communication/ promotion (Social entrepreneurship day
 Community strengthening (Mentors network)
 Subsidized consulting
 Establishment of competency center
 Social clusters opportunities
 Social enterprise accelerators
 Co-working spaces for social enterprises (HUB Vilnius)
 Social enterprise business plan competitions
- 2014 and beyond
 Broader definition (from social firm to Social
 Regulation? Social enterprise mark example
 Set of measures to evaluate social innovation impact
 Social innovation as a horizontal priority
 Promote rise awareness about pilot projects and
successful stories of social entrepreneurship and
 Soft financial support (micro-credits) and financial
engineering for new EU support period starting in
We are looking for social
entrepreneurs and innovators
Mindaugas Danys
Ministry of the Economy
SME Department director
Tel. 8 706 67922, mob. 868601247,
e-mail: [email protected]
Rokas Pečiulaitis
Ministry of Economy
SME Department project manager
JPP ‘Kurk Lietuvai‘ participant
Tel. 8 706 63022, mob. 861601791
e-mail: [email protected]
Facebook: Kurk Lietuvai